Thanks Tim, and good morning everyone. It is indeed a pleasure to be here. I almost don’t have to give my speech because I think Tim summarized some of the key points for me, but I’ll go ahead and try anyway.

Let me just begin by explaining a little bit what my role is at Microsoft, so you can have some perspective on the comments that I offer and the role that I play. I’ve been at Microsoft about nine years, and originally went there to start all the company’s activities in non-PC computing.

So I mean, as Tim said, Microsoft is a company that tries to learn and tries to move ahead. And as far back as 1992, we had decided that the world in fact was going to change substantially — that we wouldn’t just find computing in the things that we call computers. And my job was to try to move the company in that direction. And so, many of the things that you see today in terms of Windows CE and Pocket PCs, auto- and television-based products, are things that I did in the first six-plus years that I was there.

Three years ago, those things came to a point of maturity where Microsoft realized they needed to be blended together, and we needed to address the marketplace by thinking in a more holistic way about computing and how we offer those products, not only to enterprisers but to consumers. And we merged all those together. At that time Bill also — Bill Gates — had decided to focus his entire energy, going forward, on questions of strategy and architecture for the company, because we recognized that the market ahead of us was probably more turbulent than any market the company had known in its twenty-odd years of history.

It was at that time that Bill asked me to go work for him, and I’ve done that for the last three years, working with him almost exclusively on prospective issues of architecture and policy and strategy for the company. And in that role I try to support Bill and other executives, to take on policy issues and to be a speaker for the company about things that we’re concerned with. And usually that falls in the realm of things that happened in the capitals of the various major countries of the world, but in this case there are a set of issues here that are quite profound and [we] decided that we should speak out about them and try to at least provide leadership.

In the discussion that has ensued since I gave the first comments about this at New York University Business School the third of May, our goal all along has been one of creating an environment around informed choice. So my role in coming here today and in speaking out about these issues for the last several months has not been about one of trying to legislate anything to anybody, but rather to create the dialogue and make people understand what we think some of the long-term implications of their choices are.

If you look at the reportage that we have had over a lot of my comments — and as I thought about coming to this conference — go to the next slide — we wondered a lot about how I hould actually introduce myself.

[The slide superimposes the faces of Craig Mundie and Dave Stutz over those of Dr. Evil and his Mini-Me.]

[Audience laughter] David and I came to this conference — Dave, of course, can be here for the entire conference, I can only stay for part of the day — we wondered, What is it that people think we’re really trying to do? Why are we taking on this battle? It clearly, certainly has been reported at times that Microsoft doesn’t like open source. So let me be clear. One of the reasons I came to this conference is to speak to the open source community directly.

Microsoft has no beef with open source. In fact, we think it’s an integral part of an ecosystem that has fueled such tremendous success and growth around the world in the software and information technology businesses. But there are aspects of this general movement — even as Tim himself pointed out — there seem to be really two large camps in this environment: the free software movement and the open source movement per se; but largely the press has certainly been confused, because my comments have been largely directed at some of the issues that we find around the licensing regimes, around the free software movement. And yet it’s most frequently reported as “Mundie attacks open source.”

So let me be again quite clear. Open source isn’t the issue. And as I go through the rest of these comments, hopefully you’ll understand specifically the concerns that we have; why we offer these for your consideration and those of everyone else in the world, and why we are happy to have an opportunity to maintain this dialogue directly. Next slide please.

Shared Source vs. Open Source Related Links

Technetcast of the debateWith audio

Part 2: Panel Discussion

OSCON Conference Coverage

At the end of the day, the biggest concern that Microsoft has is about the long-term preservation of what we think of as the software ecosystem. This ecosystem, like those in the physical world, evolved over quite a long period of time, and they reach usually some state of equilibrium where people are happy with the results for a long time. But as we’ve learned in the physical world, certain actions that people can take on or certain things that they do can have some long-term effects on that ecosystem. And we deal with those in our daily lives as we think about endangered species, as we think about having enough electricity, and a lot of other things. And Microsoft, while certainly a company that has benefited from the commercial software environment, recognizes that we only play a small role in this large software ecosystem. And that role may be significant in some dimensions, but there are many ways in which you can measure it and in fact find that it is in fact a relatively small part, certainly by total dollar volume or any of a variety of other measures.

And so, if we think about this ecosystem — or at least, the way we think about the ecosystem — there are four different components to it that we think have a strong, symbiotic relationship, and which has led to the kind of productivity that we have in the software industry today.

[The slide shows Intellectual commons -> Industry -> Customers -> Government in a circle with arrows pointing from one to the next.]

Clearly the industrial companies are a big part of it. If you can go back in time to the beginning of computing and also to the beginning of software as we know it today, it was really a contribution that came through the intellectual commons, broadly defined, and in particular university efforts. And in fact a lot of the things that are the most popular today probably wouldn’t have had their beginning without specific government funding. Where, for example, the original Arpanet, funded through DARPA, was a key part of creating the technology that we all enjoy the benefits of today in the basic forming of the Internet. And of course the customers themselves are part of the ecosystem, not only in terms of consuming the efforts of the companies and other institutions in this environment, but more and more customers are finding that they have to do some of their own software development. And the reason is that more and more, the base business process is becoming captured in the software that defines the business. And it’s our belief that that will in fact increase over time, not decrease over time.

And so it isn’t really surprising that some aspects of the open source movement speak directly to some parts of this ecosystem. The whole idea of having an intellectual commons, outside the academic environment, seems to be a key underpinning of what people like as one aspect of the open source movement. The ability for customers to believe that they can have access to source codes at times certainly has merit, and it’s one of the areas where Microsoft has learned from this community and recognizes that there are things that we too can do to improve in this area.